The Federal High Court in Abuja has ordered the Central Bank of Nigeria, CBN, to pay Kasmal International Services N579,130,698,440 with 10% interest per annum on the judgment sum for the period from January 1, 2015, to January 31, 2020, for its role in stamp duty collection.
The judgment was delivered on Friday by Justice Inyang Ekwo in a case instituted by Kasmal against the CBN and the Attorney General of the Federation.
Nairametrics previously reported that the CBN had filed a preliminary objection against a legal action instituted by Kasmal International Services, which sought a court order barring it from disbursing all accrued deposits paid into the CBN NIPOST stamp duty collection account by all commercial banks.
Facts of the Stamp Duty Claims and counterclaims
The applicant’s lawyer, Dr. Alex Izinyon SAN, submitted that his client was appointed by the Nigerian Postal Service (NIPOST) to represent NIPOST in the collection of N50 on all receipts given by any bank or financial institution in acknowledgement of services rendered concerning electronic transfers and teller deposits of N1,000 and above, in compliance with the Stamp Duties Act and the Nigeria Financial Regulations 2009.
He added that the terms of the agreement between NIPOST and the plaintiff included the remuneration of N7.50 from every N50 deduction.
In documents seen by Nairametrics, the senior lawyer stated that his client’s percentage has not been fully paid as agreed.
He argued that if disbursement is done to the exclusion of the plaintiff’s percentage, the plaintiff will be highly prejudiced and will suffer irreparable losses.
On Friday, the judge said the submission of the CBN and AGF that NIPOST lacks the statutory power to collect stamp duties and that the agency agreement entered into with the plaintiff “does not hold water.”
The judge observed that a previous judgment concerning stamp duty that favoured the plaintiff is still subsisting and has not been overturned by a higher court.
Ekwo held that the submission of the CBN and the AGF that the reliefs sought by the plaintiff in this suit cannot be granted, as all revenues accruing to the Federation, including the stamp duties, the subject of this matter, are remitted into the Federation Account, which can only be distributed among the tiers of government as provided in the Constitution, is incorrect.
He observed that the CBN had paid the plaintiff the sum of N10.3 billion, representing 15% of remitted stamp duty by all Deposit Money Banks (DMBs) between January 1, 2015, and January 31, 2020, from the CBN NIPOST Stamp Duty Collection Account No. 3000047517.
“I find at the end that the CBN and AGF have not effectively controverted the case of the plaintiff, and the plaintiff, having made a credible case, ought to succeed on the merit, and I so hold,” he said.
“It is my opinion that this case is predicated on the fact that the 1st and 2nd Defendants have had transactions with the plaintiff before by paying the plaintiff the sum of N10.3 billion, being 15% of remitted stamp duty.”
The judge subsequently granted the reliefs of the plaintiff, ordering the CBN to pay over N579 billion with associated interest within the stipulated period.
More Insights
Stamp duty is an indirect tax imposed on several financial transactions. In 2023, Nairametrics recalls that a former CBN governor, Godwin Emefiele, revealed that the total revenue collected as stamp duty on behalf of the Federal Government in six years, from 2016 to 2022, was N370.686 billion.
The applicant approached the court to determine its percentage from the agreed terms with relevant agencies, particularly NIPOST.
